Small firms are set to receive an aid package
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Government hopes VAT cuts will encourage customer spending
As the £20billion tax cuts were announced in Alistair Darling’s pre-budget report, the government hopes the VAT reductions will encourage consumers to spend more in an attempt to improve Britain’s economy ahead of the budget report in March 2009. However to pay for the tax cut from 17.5% to 15% over the next 13 months, it’s been declared that from 2011 National Insurance would rise by 0.5% and there would be a new 45% tax rate for those earning over £150,000.
The chancellor has predicted the economy will grow from 2010 onwards, despite the International Monetary Fund cutting its growth forecasts for the economy from 1.7% to 0.1%. The IMF have also said that along with Ireland and Spain, Britain is most at risk of a housing crash and a year long recession. The Tories and Liberal Democrats have hit back at the move by the government, with the Conservatives stating that people earning over £20,000 will be worse off, while Labour claims it will only be high earners – those on £40,000 and above that will suffer.
Though it’s not all bad news, ministers have announced small firms in the UK are to receive a £350million aid package to help them cope with the financial crisis.
COMMENTS
Online Tax Preparation
2009 12 18
Yes I am one of those late filers. The reason why I ask is that I am taking a Tax Accounting course this quarter and with my texbook came a free copy of TaxCut 2007 edition. I don’t want to have to pay to file.
Online Tax Preparation
Online Tax Preparation
2010 01 05
The centrepiece will be a temporary cut in sales tax paid on many goods, Vat, which could go down to 15 per cent from 17.5 per cent for the period of one or two years, giving a pre-Christmas boost to consumers’ spending power.Online Tax Preparation
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2010 01 16
Would removing sales taxes, levies and tariffs help to boost spending amongst consumers?cartier watches
McCain wants to continue Bush’s tax cuts to the wealthy and big business. Obama wants to give middle class citizens a tax cut. Do you support McCain’s plans to continue the Bush tax cuts.Tina
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2010 01 29
Why virtually everyone liberals and non-liberals alike agree that we must support consumer spending?Facebook Layouts
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2010 02 01
Japan’s finance ministry ageed to income tax cuts to combat a decade long recession in the 1990s but only if national sales taxes were increased several years later.myspace layouts
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2010 02 09
Right on. Any good economist will tell you: During an economic crisis of confidence, the best thing to do is cut back spending and run for the door.
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